It's not that they are charging International Students more, but they are charging local students less. The state government subsidizes university education, so they want to make sure that benefit only applies to residents of their own state, who have presumably paid taxes and will continue to pay taxes. The state gets the money from its residents to begin with, so they are merely redistributing. Also if you will notice it's not just International Students, state's also descriminate against students from other states too.